[This post was first published in the Fairfax NZ Sunday Star Times on 23 March 2014]

In recent years the venison industry has gone backwards. Total farmed deer numbers declined from about 1.8 million in 2005 to 1.1 million in 2011. The most recent 2013 annual slaughter statistics show that 53% of slaughtered animals were females. This is a sure sign of ongoing retreat. So what has gone wrong and what can be fixed?

Back in the 1980s, AgResearch data from Invermay Research Station suggested that red deer were more efficient at converting grass to meat than non-deer species. We now know that on an overall farm system basis that notion was wrong.

The female deer reproductive system has been designed by nature to only produce one progeny per year. This productive disadvantage would not matter too much if the price premium was large, and for a long time this was the case. Back in the 1980s and 1990s farmers received prices per kilogram almost three times higher for venison than lamb. In contrast, the premium in recent weeks has been barely 20% compared to lamb. Despite deer requiring less labour than sheep, this is not enough to justify the cost of the high fences combined with productivity constraints.

So where did it all go wrong?

During the late 1980s and 1990s I was involved in the fledgling Australian deer industry. In the early 1990s I led a delegation of Australian industry people, first to Asia and then later to Europe, to study the markets.

We knew that in Japan the New Zealand industry was getting higher prices than elsewhere, so we wanted to know why. The answer was simple. The higher price was because only the best cuts were being sent there. What did surprise us was that it was all going into French-style restaurants; it was not part of local Japanese cuisine at all. We quickly identified that it would be challenging to incorporate venison into this Japanese cuisine given fundamental characteristics of the lean venison. That remains the situation.

In Korea we identified that venison was being imported with lower tariffs than beef, and in some situations was being sold as beef. I recall one meeting with a rather large Korean meat marketer. He was indeed a big man and he looked uncomfortable as he fidgeted in his chair. Eventually he stood up, removed a pistol from his bulging pocket, placed it on the table, and then sat down again. I could not help but notice that the pistol was pointing straight at me. He then set forth his vision for the Korean venison industry. I nodded my agreement, and when he finished I expressed my admiration for his wisdom and foresight. By then I was well aware that marketing venison was indeed somewhat different to other products.

On visiting Europe we found that tariffs were minimal because the farmed deer were classed as ‘game’. There was no logic to this but everyone in the red deer venison system was doing well from the charade. The officials also knew precisely what was happening, but as long as everyone kept quiet they had no need to intervene.
We observed in restaurants that the price of beef was very similar to venison. They were both expensive. The European beef was very much a protected market with high trade barriers. If either beef prices or beef tariffs were ever to drop then that would indeed be a worry for the competing venison.

More than 80% of New Zealand venison still goes to Europe. A fundamental problem is that Europe is in a long term recession. Also, there is now a lot of cheap wild shot venison coming out of countries like Spain and also from Eastern Europe.

Back here in New Zealand we are always quick to criticise our lamb marketers, but the reality is that lamb prices have increased greatly in the last 15 years, much more so than venison. Also, whereas the China market now underpins lamb and mutton prices, this is not the case for venison. So behind the farm gate, deer are struggling to compete.

Another part of the New Zealand story has been the boom of the dairy industry. On many farms we now see dairy young stock behind the high fences on what were once deer farms.
The one area of New Zealand where the venison industry has managed to hold its own is the tussock grasslands of the South Island. Deer, with their late spring and early summer calving, better fit the feed production profile there than elsewhere in New Zealand.

The big question, therefore, is whether the venison industry can ever boom again like it did some 10-20 years ago. It looks like being a considerable challenge which has to start at the marketing end of the chain.

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About Keith Woodford

Keith Woodford is an independent consultant, based in New Zealand, who works internationally on agri-food systems and rural development projects. He holds honorary positions as Professor of Agri-Food Systems at Lincoln University, New Zealand, and as Senior Research Fellow at the Contemporary China Research Centre at Victoria University, Wellington.